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[11:00:14]

KATE BOLDUAN, CNN ANCHOR: Hello, everyone. I'm Kate Bolduan. We do begin with breaking news right now, as President Trump is welcoming one key ally to the White House moments from now, the White House is forced to apologize to another key ally.

I want you to listen to what this is about in terms of the apology. Sean Spicer talking about the United Kingdom yesterday. Listen.

(BEGIN VIDEO CLIP)

SEAN SPICER, WHITE HOUSE PRESS SECRETARY: Fox News on March 14th, Judge Andrew Napolitano made the following statement. Quote, "Three intelligence sources have informed Fox News that President Obama went outside the chain of command." He didn't use the NSA, CIA, FBI, or the Department of Justice. He used GCHQ. What is that? It's the initials for the British intelligence spying agency.

So simply by having two people saying to them the president needs transcripts of conversations involving Candidate Trump's conversations, he's able to get it and there's no American fingerprints on this.

(END VIDEO CLIP)

KEILAR: Spicer there citing a Fox News report that British intelligence helped the Obama administration spy on Donald Trump. The U.K. not happy. A spokesman for the prime minister calling the claim, "utterly ridiculous."

This comes as the president is standing by his allegations that the former president, President Obama wiretapped him despite the fact that the Republican chairs of the House and Senate intelligence committees have all come out to say there is no evidence to back that up. So now what started as a Twitter accusation has become an international incident.

Let's bring in Jeff Zeleny right now at the White House for us. Jeff, one thing you noticed that stands out on this, this is not a White House to apologize very often. What does this say about this? JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: It certainly isn't, Kate. It shows how important this is and how grave this matter actually is. I mean, the reality here is that Sean Spicer, the White house press secretary, when he was reading from the long list, trying to craft some type of explanation for this whole bizarre wiretapping claim that's been consuming this White House for two weeks now, he was reading through a laundry list of what he called news reports.

But actually it was fringe reports on commentaries, other things, but the U.K., of course, was watching his briefing. When you're speaking from the White House podium, of course, the world is watching. So immediately after Sean Spicer suggested that the British intelligence may have helped President Obama spy on Trump Tower, the White House got an earful from the British, the spokesman for the British prime minister, as you said earlier, said this is utter nonsense and it went on from there.

So overnight the White House was forced to agree to apologize to this. This is really the first time that the new national security adviser, H.R. McMaster, has weighed in here. And he said, look, it was not intentional, it won't happen again.

But intentional is interesting, Sean Spicer was reading from a long list for 8 minutes straight yesterday. It shows that every word spoken from this White House has consequences. It seems to me that this White House is still trying to learn that lesson -- Kate.

KEILAR: They're still getting used to that standard, if you will. Jeff, this all comes on a very important day for this president and his relationships abroad. German Chancellor Angela Merkel is visiting.

ZELENY: She is indeed. She'll be here really within the next few moments or so. People are starting to line up on the entrance here to the west wing lobby. And now, Kate, this is arguably the most important face-to-face meeting with a world leader that this president has yet to hold in the first couple of months in office here.

He of course has such history with Angela Merkel. He's never met her face-to-face, actually, but he has suggested that her immigration policies have ruined Germany. That's something he said in 2015. So this is a reset of that relationship.

So interesting, Kate, she's been studying his speeches, his activities, to try and get a read on this. So it's definitely resetting a relationship. It's in the interests of both countries, of course, to have a good relationship.

We'll see how that goes today. Here at the White House, he'll be meeting with her in the oval office, a private lunch, as well as a press conference in the east room this afternoon -- Kate.

KEILAR: Even putting policy differences aside, the styles of these two world leaders could not be more different. We could be seeing that on full display today. We'll be watching it with you. Jeff, great to see you. Thank you so much. CNN has learned that at least one House Republican now thinks that President Trump should apologize to his predecessor for claiming that former President Barack Obama wiretapped him. Listen to this.

(BEGIN VIDEO CLIP)

REPRESENTATIVE TOM COLE (R), OKLAHOMA: I see no indication that that's true and so it's not a charge I would have ever made. Frankly, unless you can produce some pretty compelling proof, then I think the president, you know, President Obama is owed an apology in that regard. If he didn't do it, we shouldn't be reckless in accusations that he did.

(END VIDEO CLIP)

[11:05:09]KEILAR: Joining me right now is the guy you saw asking the questions there, CNN's senior Congressional reporter, Manu Raju. So Manu, this is a big statement coming from an important House Republican.

MANU RAJU, CNN SENIOR CONGRESSIONAL REPORTER: Yes, absolutely. I've talked to a number of other Republicans who are not willing to go that far including Congressman Darrell Issa, another prominent Republican, who says I'm not going to suggest anybody should apologize.

But Tom Cole is someone who is influential within the House Republican Conference. He has a lot of respect from the leadership and also from the rank and file and is viewed as a pragmatist as well and, someone who is making a pretty strong statement that it's time for President Trump to apologize.

Now, this comes as a number of Republicans are just frankly fed up with the White House's handling of the wiretapping issue. They believe that there's no evidence, they believe what the House and Senate Intelligence Committees have been saying, there's no evidence of wiretapping, and that the president and the White House continuing to dig in is a major distraction and also hurts their credibility.

One Congressman, Congressman Charlie Dent who I just spoke with as well, said that this does undercut the president's credibility and it really saps his political momentum. And I believe we have sound of Charlie Dent right here, let's take a listen to what he had to say.

(BEGIN VIDEO CLIP)

REPRESENTATIVE CHARLIE DENT (R), PENNSYLVANIA: It's inexplicable. I've said that the original tweet accusing former President Obama of wiretapping the current president's phone, apparently there is no evidence or any basis in fact. So I think he should simply retract it.

(END VIDEO CLIP)

RAJU: So this comes of course at a critical time, Kate, a time when the president is trying to sell his own party to get behind a health care bill that many Republicans are not ready to support, and at a time when he appears to be expending a lot of his political energy on these wiretapping issues that a lot of Republicans simply cannot defend.

It does have a political impact on Capitol Hill, especially if his credibility starts to deteriorate in the eyes of the American public, it makes it a lot harder for his own party to fall behind him as well.

So Congressman Charlie Dent raising that concern shows the impact of what Sean Spicer said in the White House briefing room and what the president continues to say, it has a large impact potentially on the president's agenda going forward.

KEILAR: I thought Charlie Dent when he was speaking to me earlier this week summed it up well, from his perspective as a lawmaker, he says when the president speaks it's policy, when the president tweets it's policy. That's the basis of where he's coming from on this one. Great to see you, Manu. Thank you so much.

RAJU: Thanks, Kate.

KEILAR: All right, from one apology to the other, back to the apology that has been made by this White House so far, to the British. Let me bring in right now Bob Baer, CNN intelligence and security analyst and of course, a former CIA operative, and Alex Burns, CNN political analyst and national political reporter for the "New York Times."

Bob, first to you, what was your reaction when you see the British government calling something the White House says, said from the White House briefing ridiculous and should be ignored?

ROBERT BAER, CNN INTELLIGENCE AND SECURITY ANALYST: Well, Kate, it was ridiculous. GCHQ is the national security agency of Britain. It operates under very, very strict guidelines, strict laws, and for GCHQ to make a press statement like this, I've never heard of it. It's unprecedented. They are furious.

The accusation that Sean Spicer made is Britain got involved in our politics, which for the British is a red line. I like to add that if this White House continues to play with national security like this for political partisan purposes, and frankly, bat around lies that everyone knows is a lie, this is going to hurt our security. And Sean Spicer is going to get people killed because GCHQ will stop cooperating eventually.

KEILAR: That's a real concern when you want to talk about fallout from anything like this. Alex, one thing from the political perspective, you do not see this president or this White House apologize. That speaks to their concern about what the fallout could be here.

ALEX BURNS, CNN POLITICAL ANALYST: You don't see them apologizing as a general matter. You don't see them really even see walking back claims that the president makes. What we've seen over the last few days is Sean Spicer in that briefing room trying to tap dance around the very basic and inflammatory assertions that the president himself has made. KEILAR: This was not a shoot from the hip moment that Sean decided to bring it up. He was reading this.

BURNS: Well, but, you know, I suppose that it's not shoot from the hip in that it was from a prepared document. But it was kind of shoot from the hip in that this is clearly not something that, you know, the American intelligence and foreign policy community would say, yeah, go with that, right? Just speaking to the politics of this, it is a challenge for the White House to, you know, during the campaign, the president said over and over that once this is over, he can be as presidential as anyone, right?

[11:10:09]And when you look at the polling, there is this expectation that, you know, he will be different or he would stop tweeting or things like that. That part clearly hasn't happened, right?

It's part of the reason why events like a state visit from a major foreign leader, such an important test for the president, can he rise to that moment against the backdrop that we're talking about right now.

KEILAR: Yes. One thing they didn't need is this meeting with Angela Merkel overshadowed or have some cloud regarding relationships with key foreign allies kind of hanging over this. You say that British intelligence could just stop cooperating with U.S. intelligence. Does an apology clean it all up from your perspective, Bob?

BAER: Apology, he has to stop, like I said, playing around with national security, Kate. The real point here is, if he, the president, and the press secretary, are taking their intelligence from alt-right outlets, whether it's Breitbart or anywhere else, how do we know they're not doing the same regarding North Korea which we're talking about going to war with?

I don't know. I mean, this may be coming from the intelligence community or it may be somebody that's watching, you know, cable TV and that's where they get their intelligence. That really does worry me. I mean, how deep does this go, people relying on conspiracy theories?

KEILAR: And has the fallout been stopped? We'll see with regard to this one. It's just kind of playing out before us as the moments tick by. Bob, great to see you. Thank you so much. Alex, please stick around, we have more to discuss with you ahead.

Another big headline, when it comes to the Republican health care bill. Right now it is all about the math. Not how much your health care costs, but rather how many votes House leaders can get or maybe more importantly, how many they can spare to lose at this moment.

According to CNN's count right now, Republicans can only afford to lose 21 votes. That seems to be where it is. How many they have, that's a key question. That is tough math. The president is confident, though, the support is there. Here is what he said moments ago after meeting with House Republicans.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES OF AMERICA: I want everybody to know that the press has not been speaking properly about how great this is going to be. They have not been giving it a fair press. The press is, in many cases, you know I call it the fake news. Fake news. This is going to be great for people. I watch, I say, that's not the bill we're passing. And I also want to note that all of these no's or potential no's are all yeses.

(END VIDEO CLIP)

KEILAR: All right. Joining me right now, CNN national politics reporter, M.J. Lee. She has been following this health care bill from the beginning to wherever it stands right now, CNN Congressional correspondent, Sunlen Serfaty, is on Capitol Hill, and also CNN politics reporter, Tom LoBianco is joining us as well.

Sunlen, I always like to say as a former Congressional reporter, the usual caveat applies, you can't call the vote until the last vote is cast, of course. But what are Republican leaders saying about this? Then we'll get to what the president is saying now.

SUNLEN SERFATY, CNN CONGRESSIONAL CORRESPONDENT: Yes, Kate, I think the fluidity reflects of all of this really reflects the moment here on Capitol Hill and this bill is very currently in the deal making stage, so to speak, as leadership and the White House clearly are working to make changes to this bill that they can bring to not only get out of the Rules Committee where they'll make these changes but bring to the House floor sometime next week.

As you know, they're not going to bring anything to the House floor that cannot pass. So all these little deal making moves and the fluidity of all this really does highlight how frantic things are right now for the leadership to find something that they can pass, to make changes that can be made amenable to conservatives and moderates.

KEILAR: As you're talking about Republican leaders and changes they can make, House Speaker Paul Ryan is speaking right now at a national review event. Let's listen to him for a second.

REPRESENTATIVE PAUL RYAN (R), HOUSE SPEAKER: -- that we can make changes that improve the bill, refine the bill. The big pieces are all there. The president, this is where I think he just got off the news, he was meeting with the biggest conservative caucus in Congress called the Republican Study Committee that you and I cut our teeth in.

He worked with them, and they're all on board, because they, with the president and the rest of us, have been talking about improvements to the bill. Those improvements are being made as we go through this process. It's basically more federalism.

Making sure that we respect the fact that states can experiment and tailor Medicaid to meet their needs. As we get through this, what we're finding out is this is an exciting time. And I know what's happening is people are saying, gosh, I wish you had this or that reform in this bill. The challenge for us in the House is we have to work with the Senate rules. And the Senate rules are pretty tight on this thing called reconciliation, which means you have to write a bill that cannot be filibustered.

[11:15:05]And that means you can't put everything you want in the bill, otherwise it will be filibustered and it will be a show vote, a phony, fake vote. We had a lot of votes repealing Obamacare that we knew could get filibustered, and we don't want to go down that path again.

Because we actually really within our power as Republicans have the once in a lifetime chance to actually repeal and replace Obamacare. We have to use those Senate rules to do that so it can't get filibustered.

We proved in the last session that we can put a bill on the president's desk repealing Obamacare, basically fiscally gutting the law. We've taken that bill and added replace to it because so many of our members, conservatives and everybody in between, including the president, have said do repeal and replace.

Don't just repeal it and then have the thing collapse. Repeal it and replace it with patient-centered health care that's market driven, that gives people the ability to go and do and buy what they want in a deregulated marketplace.

UNIDENTIFIED MALE: I'm going to push you on various criticisms from all over the map. One is, you're the House, why don't you just produce an internally coherent bill that doesn't necessarily take account of what's going on in the Senate or what the Senate rules are, and then pass this kind of pure bill, and then let Mitch McConnell mess it up later rather than starting out with what for a lot of people feels as though it's a compromise of a compromise.

RYAN: Again, the Senate rules, this is what a lot of people don't understand how it works, the Byrd rule we call it. If we do that, they can't even bring it up in the Senate. Chuck Schumer can say, this violates the Byrd rule, and then it takes 60 votes to even consider the bill.

So Mitch McConnell couldn't even bring the bill up. If we send a bill from the House that doesn't conform to reconciliation with the Byrd rule, the Senate can't even consider the bill. They can filibuster even going on the bill.

So that's why we have to write this in such a way that Chuck Schumer can't block it from coming to the floor with a filibuster so that Mitch McConnell can make sure that they can vote on the bill and get the bill passed.

Remember, this is a three-part plan here, all simultaneous parts. First is a bill that we can use reconciliation for that they cannot filibuster. That's where you can repeal the individual and business mandate. That's where you can repeal the spending and the taxes. That's where you can put in the Republican health care tax policy, high risk pools, health savings accounts, tax credits that equalize the tax treatment of health care. That, the fiscal moving parts we can do in reconciliation.

Part two, and Tom Price just came to our conference two hours ago and walked a lot of our members through the enormous regulatory flexibility that he has. When they wrote Obamacare, they wrote this thing in Harry Reid's office on Christmas Eve in 2009.

They were going on the fly and they basically said, boy, there's a lot of stuff we can't figure out, let's let the secretary figure it out. They put 1,142 provisions in Obamacare in a 2700-page bill. There 1,442 sections that say the secretary may or the secretary shall.

It gives tons of discretion to the secretary of HHS to figure it all out. Well, they didn't think that Donald Trump was going to be president and Tom Price was going to be secretary of health and human services after Obama.

What Tom Price walked us through this morning was, these are all the things we can do using that flexibility in reverse to basically open up the marketplace. I see one of the brilliant state senators we have in Wisconsin who -- who is a nurse and a health care specialist.

Wisconsin now because of Tom Price's regulatory authority, Seema Verna, this brilliant woman over CMS, they can say, you set up your own health care structure so Wisconsin can have whatever plans Wisconsin wants to have and Republican tax credits, the HSAs risk pools, you can use that for those.

So part two is deregulate and have a patient-centered states rights run system. Part three are the other bills we would like to pass that we know we can't through reconciliation that we think make the situation even better but aren't necessary to fix the problem, make it even better.

That's what interstate shopping, association health plans, medical liability reform are all about. What the president is eager to do is to crisscross this country, making the case for those policies.

And I think it might be interesting to note that he'll crisscross in those ten states that he carried widely where there is a Democrat up for reelection in 2018.

UNIDENTIFIED MALE: So in a nutshell, if I'll just repeat it back for the sake of my own understanding, what you're saying, because of Senate rules, we cannot fully deregulate Obamacare in this legislation.

RYAN: That's right. And there are some we can, because they're tied -- they're fiscal moves. If it's fiscal policy, you can do it. If it's regulatory policy, you can't.

[11:20:06]That's the easiest way we can describe how this rule works. So we are putting as much replace policy as we can that conform to the Senate rules so that they can't block the bill from even being considered, pass that and then the administration in part two --

KEILAR: All right, you're listening to House Speaker Paul Ryan speaking at a summit in Washington hosted by "The National Review." Paul Ryan still optimistic as to where this Republican health bill stands right now and where it is headed.

When you start talking reconciliation, I'm going to pull out of that event. Let's get to Tom LoBianco. One of the key questions, though, that Paul Ryan talked about when we went to this event and we heard from President Trump at the White House.

Paul Ryan, Tom, said that obviously the president was meeting with the biggest group of conservatives, the biggest group of conservatives in the House today, meeting with kind of the leaders of the group, the Republican Study Committee, and that they're all on board. The president in the White House today said everyone in the room that was a no is now a yes. Is that what you're hearing?

TOM LOBIANCO, CNN POLITICS REPORTER: Well, it might be true for the Republican Study Committee, which is a very important block of conservative Republicans and they've been kind of on the fence with a lot of this. You have a lot of soft yes and a lot of soft no's.

So that's good. That's movement, if he's got them to yes. One of the members in there earlier, Representative Gary Palmer, there was a very interesting exchange yesterday on the House floor between House Speaker Paul Ryan and Palmer.

Palmer voted against this in the House Budget Committee earlier Thursday, and then they talked yesterday, and he said that he understands where the speaker is coming from. So he's listening to him. It's a slog.

Getting to 216, your numbers are a little weird here because we have a few members gone, House members in the cabinet now. But that's not really the group that you need to worry about. The group you need to worry about is the House Freedom Caucus. It's not this bigger conservative group, the Study Committee.

You have to worry about the smaller, sizable House Freedom Caucus, hard core conservative group. It looks right now they're still solidly no, at least everyone that we talk to is no on this. Those are the ones they have to flip. It's not the Republican Study Committee.

KEILAR: So M.J., we also heard from the president, when he was speaking with House conservatives at the White House, that the president said we've made some changes, and that's what's got -- those who were no yesterday sitting in the room are now a yes. Do we know what changes have been made? M.J. LEE, CNN NATIONAL POLITICS REPORTER: Right. So the president didn't actually say what kind of changes he has agreed to and House Speaker Paul Ryan has agreed to. What we do know are the changes that the Republican Study Committee has been pushing for.

So, for example, they would like Medicaid expansion to go away at the end of this year, go away altogether, not wait until 2020. They want all Obamacare taxes to be repealed right away.

They also want work requirements for able-bodied adults on Medicaid. I know that's a lot of wonkish talk but this goes to show the range of changes they have been pushing for and I think Tom --

KEILAR: Also important, if you want to talk about the politics at play, they make these changes, it likely can't pass the Senate and it's not going to get any moderates in the House on board.

LEE: Right. If you're reading between the lines, if it is in fact true that President Trump has agreed to some of these changes that the Republican Study Committee asked for, then what happens to the moderates who -- I mean, especially on an issue like Medicaid, they're already very jittery about the changes in the current bill.

And in fact they don't actually want the expansion to go away at all, some of these members. That would be a huge thing for these moderate members who are already on the fence to get on board with.

KEILAR: I think Sunlen summed it up perfectly as we wrap this up, this is a fluid situation. We're watching it play out as we speak. Sunlen, M.J., Tom, thanks very, very much.

All right, just a reminder, moments from now, the German chancellor, Angela Merkel, arriving at the White House for one of President Trump's most important face-to-face meetings so far. We'll bring that to you when she arrives. Stand by for that.

Plus fierce backlash against the president's wish list budget blueprint which includes doing away with funding that goes to "Meals on Wheels," the national nonprofit. I'll speak live to the president and CEO of that organization to respond to this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I am basically home-bound. I haven't been out of this apartment in like seven years. How else would I eat?

(END VIDEO CLIP)

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[11:28:41]

KEILAR: All right, happening right now, a live look at the White House were the American president and the German chancellor are meeting for the first time. It's going to be happening at any moment. We're keeping an eye on that arrival. This is the first time since President Trump took office and also the first time since their tense phone call over President Trump's travel ban. The stakes could not be higher, considering the national security and economic challenges facing both leaders, especially when you consider their already checkered past and President Trump's harsh words towards Merkel during the election.

Let me bring right now, Charles Hutchen, he was the National Security Council's director for European affairs in the Obama and Clinton administrations. He's now a senior fellow at the Council in Foreign Relations and professor of international affairs at Georgetown University.

Thank you so much for being here. I mean, as we look at this and wait for this arrival, there is always a lot of hype around these first meetings. This one might be the one to live up to that hype. How important is this face-to-face and this relationship?

CHARLES KUPCHAN, FORMER SENIOR DIRECTOR FOR EUROPEAN AFFAIRS, NATIONAL SECURITY COUNCIL: I think the hype is fully justified, it's probably the most important meeting so far and maybe one of the most important meetings of the Trump presidency, because Germany is the leader of Europe.

Merkel is really the one who is calling the shots on the other side of the Atlantic. Europe is our best partner and so it's really important for Trump to carve out a working relationship with Merkel.

The problem is on European integration, on trade, on NATO, on immigration, on climate change, they are really living on opposite planet. So the question is can they come into the oval office today and find --